Mukesh Patel.in
practical tax & investment planning online
international tax expert / columnist / author / speaker

HOW TO SIP HEALTHY RETURNS?

Investment in Systematic Investment Plan (SIP) can open

New Doors of Prosperity for your Wealth Creation!

While Manan Patel a conscious investor started timely savings of Rs. 10,000 per month in a Systematic Investment Plan (SIP), his friend Chintan Shah was too preoccupied with his business to find time for planning his investments.

Manan’s SIP has a track record of offering a 15% annualized return and thus he has calculated that he would become a ‘Crorepati’ reaping Rs. 1.1 crores after 18 years of regular savings. Chintan wakes up 4 years late and also wants to catch up with his friend.

However, he is just unable to believe how much his delayed decision is going to cost him when he is told that to earn the same target amount of Rs. 1.1 crores in the remaining 14 years, he would be required to invest double the savings amount i.e. Rs. 20,000 per month. (more…)

Now no Capital Gain without Tax Pain!

End Of Tax Honeymoon For Market Investors!

Understanding The New Capital Gains Regime

New Rules for Computation

  • Present distinction between long term and short term gains to be eliminated.
  • Current exemption for capital gains arising from transfer of personal effects and agricultural land beyond specified urban limits to continue.
  • Base date for computing cost of acquisition shifted from 1st April, 1981 to  1st April, 2000. 
  • Indexation benefits can be availed for all assets held for atleast one year.  

No More Tax Concessions

  •  Zero tax on STT paid long term capital market gains and 15% concessional rate for short term market gains to end on 31st March, 2011. 
  • No more concessional rates of 10%/20% for taxing specified long term gains. 
  • All capital gains to be taxed at the taxpayer’s applicable marginal rate. Securities Transaction Tax (STT) to be simultaneously eliminated.

 Exemptions Abolished & Redesigned

  • Present exemption u/s. 54EC via investment in specified bonds abolished. 
  • Current exemptions u/s. 54, 54B and 54F attempted to be redesigned under a new scheme of relief for roll over on the basis of a given formula.  (more…)
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